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HomeMy WebLinkAboutrda min 1989/03/02 MINUTES OF AN ADJOURNED REGULAR MEETING OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA, CALIFORNIA Thursday, March 2, 1989 Council Chambers 7:00 p.m. Public Services Building ROLL CALL MEMBERS PRESENT: Chairman Cox; Members McCandliss, Nader, Malcolm and Moore MEMBERS ABSENT: None STAFF PRESENT: Assistant City Manager Asmus, Acting Community Development Director Gustafson, Redevelopment Coordinator Kassman, Agency Attorney Harron 1. APPROVAL OF MINUTES - 2/16/89 MSUC (Moore/McCandliss) approve the minutes of 2/16/89 as submitted. (The vote was 4-0; Member Nader abstained.) 2. WRITTEN COMMUNICATION a. Letter of resignation from the Otay Valley Road Project Area Committee - Jerry F. Kelly MSUC (Cox/Moore) accept the letter of resignation and direct staff to prepare a letter of appreciation. CONSENT CALENDAR (Items 3 through 8) Items 3 and 8 were pulled from the Consent Calendar. CONSENT CALENDAR ITEMS 4, 5, 6 AND 7 WERE OFFERED BY CHAIRMAN COX, the reading of the text was waived by unanimous consent, passed and approved unanimously. 4. RESOLUTION 999 APPROVING PRELIMINARY UTILITY RELOCATION PLANS FOR THE E STREET/BAY BOULEVARD FREEWAY ON- AND OFF-RAMP IMPROVEMENTS AND AUTHORIZING LETTER OF UNDERSTANDING WITH SDG&E In May 1987, the Redevelopment Agency entered into an agreement with CalTrans for the reconfiguration of the E Street/Bay Boulevard southbound on- and off-ramp. As part of that agreement the Agency agreed to provide relocation of existing utilities where required. The report described the utility work that needed to be done to implement the ramp improvements. Phase One of the utility relocation work is an above-ground project and is an interim measure to Redevelopment Agency Minutes -2- March 2, 1989 accommodate CalTrans' schedule to reconstruct the freeway ramps. Future undergrounding plans for all utilities located north of E Street will continue to be pursued. 5. RESOLUTION 1000 APPROVING AN AGREEMENT WITH BSI CONSULTANTS, INC. FOR DESIGN ENGINEERING SERVICES REQUIRED FOR THE STREET IMPROVEMENT PROJECT ON BAY BOULEVARD FROM "G" STREET TO "J" STREET Staff recently prepared an annual pre-qualified list of design consultants. The list was established to eliminate the need to request and evaluate several proposals for each CIP project. Staff also prepared a prioritized list of CIP projects to be designed by contract. A detailed report regarding the pre-qualified list of public works consultants and the project list was accepted and approved by Council on January 17, 1989, per Resolution No. 13940. BSI Consultants, Inc. is ranked second highest of the fourteen consultants which responded to the request for statements of qualification. Therefore, BSI was offered a contract to design the second highest priority CIP project which is the installation of missing street improvements along Bay Boulevard from "G" Street to "J" Street. 6. RESOLUTION 1001 APPROVING AN AGREEMENT WITH UNITED ARTISTS AND DONALD W. CALLENDER, TRUSTEE FOR THE DONALD W. CALLENDER FAMILY TRUST, FOR REBATING POSSESSORY INTEREST TAXES PAYABLE TO THE COUNTY OF SAN DIEGO FOR THE USE OF THE TOWN CENTRE PARKING STRUCTURE Early in 1988 the County determined that possessory interest taxes were due from Centre City Associates, Ltd.-Commercial (CCAL-C), Marie Callender's and United Artists Cinema for use of the Town Centre parking structure. These included normal assessments to 1988 and escape assessments for 1984 through 1987. On July 19, 1988, the City and Agency agreed to reimburse CCAL-C for possessory interest taxes subject to their appeal to the San Diego County Assessment Appeal Board. In December of 1988, the Appeals Board determined that there was a possessory interest and established the value. Subsequent to that decision, Marie Callender's and United Artists requested that the City and Agency enter into similar agreements with them rebating possessory interest taxes paid to the County. On January 13, 1989 the Agency directed staff not to further appeal (to court) possessory interest taxes levied on CCAL-C for 1984 and to withdraw administrative appeals for tax years 1985 through 1988. Staff was also authorized to Redevelopment Agency Minutes -3- March 2, 1989 prepare agreements with United Artists and Marie Callender's for review by the Agency and the City Council. 7. RESOLUTION 1002 APPROVING A LOAN OF $36,460 TO THE SAN DIEGO COUNTY REGIONAL JUSTICE FACILITY FINANCING AGENCY TO FUND AND UPDATE THE SOUTH BAY REGIONAL CENTER MASTER PLAN In June 1988, County voters approved a one-half of one percent transactions and use tax for the purpose of funding regional justice facilities. This tax was to be implemented January 1, 1989. However, a challenge to the validity of the imposition of the tax is currently being considered by a California State Court. Until a judgment validating the tax is rendered, the County is seeking loaned funds, interest free, to begin planning of regional justice facilities. This loan was approved in concept by the Redevelopment Agency, January 19, 1989. END OF CONSENT CALENDAR 9. REPORT: STATUS OF THE CHULA VISTA SHOPPING CENTER The Chula Vista Shopping Center was essentially completed and opened for business in October 1988. Landscaping and site work has been completed. There still remains some questions as to the condition of the surface and striping of the parking lot, which remains to be fully accepted by the Building and Housing Department. Sales and sales tax revenues through June 1988 have met minimum levels pursuant to the Disposition and Development Agreement with the Homart Development Company. Mr. Tom Gourguechon, Homart Development Company, was present and gave a slide presentation of "before and after" redevelopment pictures of the Center. He noted that the Center was featured in the quarterly newsletter of Homart Development Company. Mr. Gourguechon reported that 70% of the tenant space is operating. The Center is 80% leased. The Olive Garden Restaurant will be going into the old Pacific Bell Building. He further reported the year-end performance for the Center averaged $195.00 per square foot in sales. Jewelry was the best performer at 15% over the national average. Christmas sales for existing tenants was up 40% over the previous year. The performance of the Center has been increased over 50% on a square foot basis. Mr. Gourguechon also noted that with the exception of the Vons/Osco building, all asbestos/hazardous materials will have been removed from the entire project by the end of the week. Redevelopment Agency Minutes -4- March 2, 1989 Mr. Gourguechon distributed a list of tenants after renovation showing both the new as well as the existing tenants. Member Moore asked if the City/Agency has any financial interest in the Center at this time. Redevelopment Coordinator Kassman explained that the Agency sold bonds in the amount of approximately $7,100,000 and used the parking lot for collateral. In order to use the parking lot for collateral, the Agency leased the lot from Homart; there is a sublease to the City and a sublease back to Homart for operation and management. The City and the Agency are tied into the chain of leasehold interest on the parking lot strictly in order to sell the bonds. 10. ORAL COMMUNICATIONS - None. PULLED ITEM____~S 3. STATUS OF LEASE NEGOTIATIONS WITH SAN DIEGO SHIPBUILDING & REPAIR, INC. At the Agency meeting of January 19, 1989, the Agency, after modification, approved a lease with San Diego Shipbuilding & Repair, Inc. for the period February 1, 1989, through January 31, 1990. At the Agency meeting of February 2, 1989, the Agency further modified that lease. As of this meeting, Mr. Gurnee of San Diego Shipbuilding & Repair, Inc. had not signed the lease due to objections to the modifications made by the Agency. Therefore, San Diego Shipbuilding & Repair, Inc. remained in occupancy of Agency premises without a lease. Member McCandliss referred to a letter received from Mr. Gurnee dated February 27, 1989 which was distributed to Agency members at this meeting. She stated the only element in the letter that she would be willing to consider is the extension of the lease for a longer period of time. She believes the amount to be charged for rent is fair, the penalties and the accelerated departure as outlined by the Agency are also fair. Acting Community Development Director Gustafson reported there is an error in Section 32 of the lease agreement. It refers to Section 28; it should read Section 29. Further, one of the concerns Mr. Gurnee had expressed is that he had the impression from the language in the lease that if he were to exercise his 90 day option to leave early, that he would be charged the $1,000 per day liquidated damages from the point at which he had left until the end of the year lease. The language is intended to suggest that if he stays after the year lease he would be charged the $1,000 per day liquidated damages. If he gave a 90 day notice to leave Redevelopment Agency Minutes -5- March 2, 1989 early, but stayed beyond the 90th day, then he would be charged the $1,000 per day liquidated damages. Mr. Ted Gurnee was present and stated that the explanation given by Mr. Gustafson is still different from what he understood. He believes he should not be penalized after giving the 90 day notice. He suggested that he will clarify this issue outside of this meeting. Member McCandliss commented that her major concern is that the Agency will have possession of the property when it is needed. If Mr. Gurnee gives a 90-day notice, it is expected that he will have vacated the property in 90 days. If not, there will be a penalty. If a one year lease is agreed upon or a two year lease, at the end of that period, San Diego Shipbuilding will be expected to leave, if not the penalty will take place. Mr. Gurnee requested that the Agency consider extending the lease to a two-year period. Member Nader suggested an 18 month period. Member Malcolm noted he would not have a problem in extending the lease for two years. Member Moore stated his concern as being similar to that stated by Ms. McCandliss. He does not want the Agency to be prevented from moving forward with the Bayfront development because of this lease. He does not have a problem with the lease being extended to 18 months or two years. Mr. Gustafson reported the lease expired January 31, 1989. Mr. Gurnee attempted to tender rent for the month of February to the Agency at the rate of the previous lea. se; however, the payment was not accepted because it would have extended the expired lease for another year. Chairman Cox commented he does not have a problem with extending the lease for 18 months. However, he noted there needs to be a realization on the part of all parties that this will be the end of the lease (there will be no future extension). At the end of the 18 month period, he would like to see San Diego Shipbuilding come up with an alternative location. Staff has been given direction to work with San Diego Shipbuilding in locating an alternative site. MOTION MS (Malcolm/Nader) extend the lease for an 18 month period and prepare a letter for Mr. Gurnee clarifying the penalty question. Member Malcolm clarified the lease will be for an 18 month period beginning March 1, 1989. The month of February, 1989 is to be paid at the previous rate. Redevelopment Agency Minutes -6- March 2, 1989 Member Moore stated he wanted it on the record that the Agency did not solicit this contract. Responding to Chairman Cox' question regarding liability or obligation on the part of the Agency to pay relocation expenses, Agency Attorney Harron stated San Diego Shipbuilding leased the property after the Agency acquired the property. Therefore, no relocation benefits will be provided to San Diego Shipbuilding. Chairman Cox asked Mr. Gurnee if it was his understanding from a legal standpoint that he would not be entitled to relocation benefits and Mr. Gurnee acknowledged that he understood this. The motion passed unanimously. MOTION MSUC (Malcolm/mccandliss) that if the lease is not negotiated and signed within a ten day period (ten days after receipt of modified lease from the Agency), the Agency Attorney will start eviction proceedings. 8. RESOLUTION 1003 APPROVING AGREEMENT WITH M.R. FARRELL & ASSOCIATES FOR NEGOTIATING SERVICES RELATED TO THE EXCLUSIVE NEGOTIATION AGREEMENT WITH CHULA VISTA AUTO CENTER, INC. FOR DEVELOPMENT OF AN AUTO SALES PARK AND APPROPRIATING FUNDS THEREFOR The Agency is engaged in an Exclusive Negotiation Agreement with Chula Vista Auto Center, Inc. to develop an auto sales park on Otay Valley Road, east of Interstate 805. Consultants have been employed by the Agency to appraise property values, assess environmental conditions of the properties, draft legal documents, and analyze the economic feasibility of the proposed development versus the alternative of industrial development of the site. Further assistance is needed with the analysis of data and with direct negotiation. Proposals were solicited from firms having experience with auto sales park development. It was recommended that the Agency approve an agreement with M.R. Farrell & Associates for this purpose. Member McCandliss asked at what point there would be a public hearing on either the development of this plan or the Disposition and Development Agreement. Mr. Gustafson stated it would be at the point at which the Environmental Impact Report is prepared for adoption, approximately the beginning of September, 1989. RESOLUTION OFFERED BY MEMBER MALCOLM, the reading of the text was waived by unanimous consent. Redevelopment Agency Minutes -7- March 2, 1989 Member Nader stated he has a concern that the pros and cons of commercial use versus industrial use is still being evaluated. By approving this contract, it appears the Agency is moving ahead toward negotiating an agreement. To pay for this type of work seems premature at a point before any public hearings and any formal input from the Project Area Committee has occurred. Mr. Gustafson stated this is one of the reasons that as part of the agreement the work will proceed at $5,000 increments to be approved by the Executive Director. The consultant's report that compares the industrial use and the auto park use is expected in the near future. If at that point it looked inappropriate to move forward with the project, then the Agency would not have to continue with this particular agreement. The resolution passed and was aDproved unanimously. 11. DIRECTOR'S REPORT: None. 12. CHAIR/~AN'S REPORT: Chairman Cox pointed out problems with the crosswalks in the downtown area. Tape has been used to mark the crosswalks which has shifted and broken apart. Assistant City Manager Asmus stated this situation will be looked into. 13. MEMBERS' COMMENTS: Member Nader referred to a letter from Peter Watry of Crossroads dated March 2, 1989 which was distributed to Agency members at this meeting. This letter was concerning the proposed Bayfront development by Chula Vista Investors(William Barkett). One point of concern in the letter is that Mr. Barkett is at the point of investing in an Environmental Impact Report on the plan presented to the Agency. Member Nader stated he believes it is the Agency's intent that there be substantial further communication between the Agency, the Agency Subcommittee, staff and Mr. Barkett before a final project is decided upon. He is concerned that Mr. Barkett may be in a position of believing that the Agency has given its approval to the plan at this point. Mr. Gustafson stated staff has been encouraging Mr. Barkett to undertake an EIR that looked at other alternatives in detail (i.e., reduction in density, additional open space, etc.). He is disinterested in doing that. Member Nader pointed out that a Subcommittee meeting has recently been scheduled with staff. After that meeting, a Subcommittee meeting will be arranged to include Mr. Barkett. At that point a workshop session will be arranged with the entire Agency and Chula Vista Investors. He wants to be sure this has been communicated to Mr. Barkett. Mr. Redevelopment Agency Minutes -8- March 2, 1989 Asmus stated that if this has not occurred, it will be done on March 3, 1989. Member McCandliss commented that the reason she called for the workshop on this matter is so that the Agency can be very direct with Mr. Barkett and make sure that he does understand what the Agency likes and does not like about the plan. Member Malcolm reported on the problems associated with the recent fire/hazardous waste incident at Appropriate Technologies II located on Maxwell Road. (1) Appropriate Technologies did not call for outside help for two hours. (2) Fire hydrant (it only produces 20 gallons per minute versus several thousand gallons per minute from any other fire hydrant in the City). (3) Appropriate Technologies was uncooperative with regard to contacting the County authority dealing with hazardous materials. (4) They have volatile materials there without 24 hour guards. Responding to Member Nader's questions, Deputy City Manager Morris stated Appropriate Technologies has agreed to stop shipments of hazardous waste with the exception of two. They will continue with the contract that they have with the Drug Enforcement Agency as well as some household hazardous waste; other than that they have discontinued all other contracts voluntarily. Member Nader stated he would like to know if hazardous waste is being accepted from outside of the local regional area. Mr. Morris stated he will report back on this at the next City Council meeting. Member Moore noted concerns with skateboarding in areas of the City. Specifically, he has noticed abuse by skateboarders at Memorial Bowl, the Library fountain area, and City Hall. He suggested signage needs to be put up on the City property regarding the ordinance pertaining to skateboarding, or perhaps information on the ordinance should be included in the City's quarterly newsletter to the public. Member Malcolm informed the Agency that SDG&E will be filing with all the appropriate agencies to expand the Chula Vista power plant and to increase its operation. MOTION MS (Nader/Malcolm) referral to the City Attorney for a report to come back on any ordinances that could be adopted that would prohibit polluting activity within the Coastal Zone particularly in terms of expansion of a fuel burning plant; to require discretionary permits before the Council to the maximum extent possible. Redevelopment Agency Minutes -9- March 2, 1989 Mr. Harron stated at this point he would like to prepare a generic ordinance that would state any building permit involving power plants shall be subject to a public hearing and review for potential air pollution problems/nuisances. If SDG&E does come forward with plans to expand the power plant, then he would suggest consulting with appropriate experts in the field to prepare a more specific ordinance. Mr. Nader stated this would be adequate for his concern with the proviso that the City require a permit on everything possible regarding this matter. The motion passed unanimously. Chairman Cox referred to an information item in the agenda packet for this meeting regarding the Town Centre Local Development Corporation. It was noted that this item should be placed on a future agenda as a report; a Council Conference will not be required. ADJOURNMENT at 8:45 p.m. to Closed Session to discuss the potential acquisition of property located at: 354 Church Avenue (Miguel A. & Fernandez A. Cardenas, owners) and 275 F Street (F Street Corporation, owner). ADJOURNMENT from Closed Session at 9:10 p.m. to the regular meeting of March 16, 1989 at 4:00 p.m. D~d ~uStafson A~ting~Community Development Director